Chapter 19: Smart money — bad results

A trusted sales technique employed by stockbrokers over the years to panic investors into buying or selling has been the smart money drill. It goes something like this: ‘I can’t say too much about what is going on, but suffice to say there has been some very smart money buying the stock in the last few days’. The natural conclusion for investors is that if the smart money is buying, then it must be a good sign and it is time to jump in. Alternatively, if the smart money is bailing out of a stock, you should follow suit. I can guarantee you that if you hang around the market long enough you will get hit with the sales line about the smart money. Every time I have asked who this smart money was, I have ...

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